Venture capital investment into European startups is inching back, hitting $11.8 billion in Q1 2024, according to Crunchbase data.
The sector took a swift tumble in 2023 following record-setting years immediately after the pandemic.
Now, venture capitalists across the continent are rebuilding — cautiously. According to the latest report by Swiss private equity firm DAA Capital Partners, “VCs are expected to maintain their cautious investment approach, complemented by an increased focus on active engagement.”
As raising new funds has become more challenging in light of a global economic slowdown, VCs are showing startups other ways in which they can provide value to help them grow. DAA reports that investors are going “beyond financial investment,” to provide “close collaboration to align strategies, mentorship, and operational guidance.”
With a cautious approach in mind, the report also says that VCs are focused on supporting businesses that can endure “volatility and uncertainty,” harking back to the Ubers, Squares, and Stripes that were built during the 2008 financial crisis.
As VCs show their scrappiness in terms of providing value to their portfolio companies, and ultimately, to their funds’ investors, we take a minute to appreciate some European venture capitalists who are contributing to the success of local and international startup ecosystems and could be part of building the next generation of resilient companies to emerge from financial hardship.
Cemex Ventures
The venture capital arm of the global building materials corporation, Cemex Ventures, focuses on driving innovation in the construction industry or construction technology (ConTech), with their investments focusing on sustainable building solutions that promote efficiency and sustainability.
Cemex recently released a list of ‘top 50 most promising ConTech startups in 2024,’ insisting that despite a decline in venture capital spending in 2023, the ConTech segment remained resilient with an increase in deals compared to 2022.
Headquartered in Madrid, Cemex’s notable investment includes CleanFiber, which manufactures high-quality cellulose insulation from recycled cardboard, a product that significantly enhances energy efficiency in buildings while utilizing waste products.
Climentum Capital
Climentum Capital is a green tech-focused venture capital firm that invests in startups which are developing technologies with the potential to significantly reduce CO2 emissions. Their portfolio includes innovations in clean energy, sustainable agriculture, and circular economy models.
With offices in Germany, Copenhagen, Berlin and Stockholm, Climentum has invested in companies like Qvantum – known for innovative heat pumps and redesigning how European cities are being heated, Continuum – known for zero-emissions wind-blade and composite materials recycling and more such companies.
Climentum’s mission is to support the transition to a low-carbon economy by financing the technologies that will drive this change.
Earlybird Venture Capital
Germany-based Earlybird Venture Capital is known for its keen eye for emerging technologies and its ability to back some of Europe’s most successful tech startups.
Earlybird has invested in companies like Enevo – focused on transforming the financial, environmental and social impact of waste. The company also has companies like Lexoo that provides flexible legal outsourcing solutions for in-house legal teams.
Focusing on sectors like digital health AI, and SaaS, Earlybird provides not just capital but also strategic support to ensure its investments reach their full potential. Their success stories often become leading players in their respective industries.
Zubi Capital
Spain’s Zubi Capital is committed to driving social and environmental impact through its investments.
The firm focuses on innovative solutions that address critical global challenges such as climate change, resource scarcity, and social inequality. Its investment strategy is geared towards startups that promises both high returns and a commitment to positive societal impact.
Earlier this year, Zubi Capital and the European Investment Fund (EIF) entered a strategic agreement under the Invest EU program to promote the growth of impact startups.
In February 2024, the investment company Angels made an investment in Zubi Capital Diversity Catalyst FCRE. WIth operations in Spain and Europe, the fund places a strong emphasis on considering the potential of diversity and inclusion.
FundingBox
FundingBox provides a platform for deep tech innovators, offering access to funding opportunities, resources, and a community to support growth and development. Its focus extends across various sectors including robotics, AI, and IoT, with an emphasis on projects that can scale and have a substantial technological edge.
With offices in Madrid, Warsaw and Odense, Denmark, FundingBox is a leader in cascade funding, as it has distributed over €100 million equity-free.
The company is now developing other strong funding capabilities through partnerships with corporate players and the setting up of VC services.
Ventech VC
Ventech VC has carved a niche in the European venture capital landscape by investing in high-potential technology companies at various stages of their development.
With a broad portfolio that includes digital media, e-commerce, and software services like Veo, Ogury, Mindler, Speexx, Botify, and Believe, the company boasts €900 million in raised funds.
With offices in France, Finland, Germany and Sweden, Ventech not only provides capital but also strategic guidance to help young companies scale internationally.
IMPACT Accelerator
Spain’s ISDI operates at the intersection of education and innovation, offering accelerator programs and digital transformation courses that equip entrepreneurs and professionals with the necessary skills to succeed in the digital age.
The company boasts of having accelerated 180 startups and distributed €45 million in funding.
Jesus Tapia, Head of Impact Accelerator, the accelerator program and investment vehicle from ISDI, believes in actively investing in digital startups, and providing them with the tools and knowledge to thrive in a rapidly evolving business landscape.
Project A Ventures
Project A Ventures is an operational VC that provides more than just financial backing to its portfolio companies. They offer hands-on support in areas such as IT, marketing, and recruiting, which is particularly beneficial for early-stage companies looking to scale quickly.
Headquartered in Berlin, the company’s investment focus spans various technology-driven sectors.
So far, Project A has backed more than 120 companies across 15 industries and 12 countries. The company’s portfolio includes HealthTech, EdTech, FinTech, InsurTech, DeepTech companies and more.
BackFund
Spain’s BackFund is a venture capital firm that claims to go beyond mere financial investment by connecting founders with leading companies to foster growth and market entry. They have a streamlined investment process designed to quickly integrate startups with their network of collaborating enterprises.
Guaranteeing “real involvement,” Back Fund offers access to its corporate venture partners to each startup that seeks to innovate through investment in startups.
Manager Adrian Gorritxo has a track record of investing in 40 startups. Meanwhile, manager Karel Escobar has 10 years of experience working with early-stage startups, from ideation to scale-up.
Tetuan Valley
Tetuan Valley is an established startup accelerator based in Spain that offers seed investment, mentorship, and training programs to early-stage startups, helping them to scale and refine their business models.
Spain’s Tetuan Valley aims to be the most vibrant startup community in Europe.
With its not-for-profit accelerator program in Europe, the accelerator aims to promote local Entrepreneurship and regional development towards technology.
Firstpick
Firstpick calls itself a high-speed VC fund and an accelerator for tech startups in the Baltics.
With 21 startups and 50 founders in their portfolio, the company believes that, “diverse, energized, and building tech for a better world – these are the startups that keep us going.”
Since 2022, the Lithuanian VC has invested in companies like Ama care, Samphire, Swotzy, Amlyze, Tractorparts and more.
Mundi Ventures – Spain
Spain’s Mundi Ventures is another significant player in the venture capital landscape. The company has backed startups like Ole, Clarity AI, Raincoat, Shift and more.
One of the more famous examples of a company backed by Mundi Ventures is Klarna – the AI-powered payments network and shopping assistant – that is closer to an IPO now.
Mundi Ventures focuses on a broad portfolio, including environmental, social, and governance (ESG) criteria, indicating their commitment to sustainable and responsible investment practices.
K Fund
K Fund is a venture firm that actively invests in technology-based startups. It is known for its proactive approach in supporting the entrepreneurial ecosystem, providing not just capital but also strategic advice to foster innovation and growth.
“We invest €100k to €10 million in entrepreneurs with the capacity to create differentiated technology-based products and services,” states K Fund on its website.
K Fund typically targets early-stage companies in Spain, aiming to help them scale both locally and globally.
Lanzadera
Lanzadera is an accelerator and venture capital firm that supports startups through various phases of their development. The Spain-based accelerator has backed companies like Growpro, Hippo, Gain Energy, among others.
Founded by Juan Roig, Lanzadera offers programs for different stages of a company’s growth, from initial idea to market expansion.
Lanzadera looks to provide funding, mentorship, and access to a vast network of industry contacts, emphasizing innovation and sustainable business practices.
More Than Capital
More Than Capital (MTC) is a global investment and advisory firm, with a mission to leverage the global community to select, invest in and grow companies.
Acknowledging that post-pandemic recovery offers tremendous opportunities, MTC stated that entrepreneurial activity is at unprecedented levels. The company has now become a community of over 100 business leaders.
“Beyond committing time and energy to help great founders succeed, our community members are the initial investors in our Luxembourg-based MTC, that follows an industry agnostic strategy and invests globally in companies that are on the verge of expansion, scaling up and entering new markets,” the company says on its website..